MARKET CLOSE: Pyne Gould leads NZ stocks higher, Vector down

MARKET CLOSE: NZ stocks rise; Pyne Gould leads gainers, Vector falls

by Jason Krupp

April 11 (BusinessDesk) - New Zealand stocks rose, snapping three days of declines, lead by Pyne Gould Corp. on reports that investors could receive their shares in Business Society Holdings as early as May. Vector Ltd. fell amid protests over further changes to monopoly price regulation.

NZX 50 Index rose 16.04 points, or 0.5%, to 3,461.31. Within the index, 25 stocks rose, 10 fell, and 15 were unchanged. Turnover was $92.5 million.

Pyne Gould, the financial services firm whose Marac Finance unit makes up over 70% of BSH, rose 7.7% to 28 cents after the would-be bank said it planned to distribute shares in the newly merged entity to shareholders in May, pending PGC shareholder approval.

BSH, which today published its opening financial statements as at the merger date of Jan. 7, fell 1.4% to 70 cents, having initially listed at 88 cents a share. The company said was on track to apply for its banking license in the second half of the year, and hoped to be including in the NZX 50 benchmark from October.

Tower Ltd., the insurance company controlled by Guinness Peat Group, rose 2.8% to $1.86, amid confirmation the company will formalise its interest in rival insurer AMI this week with the New Zealand Treasury. The government moved to protect AMI policyholders last week, promising to take the business over if it proved unable to meet its obligations, owing to under-insurance for the Canterbury earthquakes.

Ryman Healthcare Ltd., the retirement village operator, rose 1.2% to $2.51, with the stock continuing to gain on the announcement last week that it would break ground on its $100 million Bob Owens Retirement Village within the month.

Vector Ltd., the Auckland electricity and gas distributor, fell 4.3% to $2.46, leading decliners on the NZX 50 after it said it was "astounded" by last minute changes to the way the Commerce Commission plans to calculate regulated prices that officially came into force last year.

The company accused the Commission of proposing changes that will significantly alter the basis for price path setting with no consultation. It said the move overturned the basis under which most lines companies have been estimating the impact of the new regulatory regime for a considerable period of time, and effectively increased regulatory uncertainty in the capital markets.

"This has been an issue that has been around for a number of months, and shareholders don't like uncertainty, which is why we are seeing volatility in the price," said Karl Williscroft, a trader at Direct Broking.

Shares in Sanford Ltd., the fisheries company, fell 1.6% to $5.55 after the company said there was renewed investor interest in the stock on the back of strong prices of raw materials. The company received a 'please explain' notice from the stock exchange supervisor, but couldn't give a concrete reason behind its 15% surge through March and early April.

Turners & Growers Ltd., the fruit and vegetable exporter controlled by GPG, was unchanged at $1.61, after chairman Tony Gibbs announced he would not seek re-election at the company's June annual meeting.Gibbs had previously left GPG's board after publicly opposing the investment company’s plans to restructure last year, but retains his chairman's seat at Tower.

Shares in Allied Farmers Ltd. were unchanged at 1.4 cents after the firm, which has struggled since taking on the Hanover Finance and United Finance loan books, flagged a potential $7.5 million default to its own dead finance unit.

Managing director Rob Alloway said the firm may struggle to meet a July 1 deadline on the funds, owed to Allied Nationwide Finance, and is in negotiations with receiver McGrath Nicol to get through the repayment schedule.

(BusinessDesk) 17:48:25

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